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After talking to a Carfax spokesperson this afternoon, I think their approach is brilliant. They have enough inventory to be a good consumer experience in most markets. They already have a financial relationship with dealers, yet they started with a free model and are going into the paid version giving dealers a free taste.


They learned from the mistakes of others and are not doing the things dealers have criticized other listings providers about. They must be reading DealerRefresh. 

1) There is no advertising on the VDP and no way for another dealer to buy into a chance to take shoppers from another dealer's VDP. Once the shopper is on the VDP, its all about that vehicle from that store.

2) There is no way for one dealer to buy their way above another dealer in the search results. The listings are based entirely on relevance.

3) The link to the dealer's website is prominent. Wherever possible, the link to the dealer's site goes directly to that vehicles VDP on the dealer's site. The place with the most information on a given vehicle should always be the dealer's website, and Carfax seems to get that.


The marketing push starts April 7. They are not showing their cards, but I'd bet it has something to do with the ability to search for vehicles with the confidence they all have a Carfax report available.


However, Jeff's core question was whether they will stir up the market. Frankly, the Carfax relationship with the other listings providers could be worth more than the additional net profit they can obtain as a listings service. I doubt they will go at this market with a shark-like attitude. More likely, they will use their additional power to force other listings services to play on their terms. If Cars.com, AutoTrader.com, and Edmunds.com are smart, they will find a way to play nice with Carfax. If they approach it another way, they could find out how strong Carfax can really be. For dealers, increased competition for their business is good news either way.


There is one area of preparation where dealers should take note. The importance of VDPs on the dealer's website just went up. Carfax will use them as landing pages, much as good SEM providers do for long-tail searches.